Decision support system based on energy markets

ABSTRACT

A system for purchasing and selling power that fairly accommodates sellers and buyers. For instance, a submarket may be formed between a utility company or retailer and its consumer or customer. The utility or retailer may eliminate differences between generated or purchased power and demanded power. Mechanisms used for elimination of power differences may incorporate utilizing power from ancillary services, purchasing or selling power on the spot market, and affecting a demand for power with demand response programs. A difference between purchased power and demanded power may be minimized by forming an optimal power stack having a mix of power of the demand response program, power at the spot market and/or power of ancillary services. An optimization sequence may be implemented to minimize the difference between the purchased power and demanded power, and to maximize profit.

BACKGROUND

The present disclosure pertains to power and particularly tostabilization of power grids. More particularly, the disclosure pertainsto buying and selling power.

SUMMARY

The disclosure reveals a system for purchasing and selling power thatfairly accommodates sellers and buyers. For instance, a submarket may beformed between a utility company or retailer and its consumer orcustomer. The utility or retailer may eliminate differences betweengenerated or purchased power based on day-ahead predictions and demandedpower in a given day. Mechanisms used for elimination of powerdifferences may incorporate purchasing or selling power on the spotmarket, and affecting a demand for power with demand response programs.A difference between purchased power and demanded power may be minimizedby forming an optimal power stack having a mix of power of the demandresponse program, power at the spot market and/or power of ancillaryservices. A transmission and system operator (TSO) may operate adistribution grid and maintain grid stability through a use of ancillaryservices. The utility may pay a fee for elimination of its eventualpower imbalance to the TSO. An optimization sequence may be implementedto minimize the difference between the purchased power and demandedpower, and to maximize profit.

BRIEF DESCRIPTION OF THE DRAWING

FIG. 1 is a diagram illustrative of the components and dynamics among anenergy market, a retailer and consumers;

FIG. 2 is a diagram of a graph of generated power and load versus time;

FIG. 3 is a diagram of a graph of a power difference between generatedpower and load versus time;

FIG. 4 is a diagram of graphs relevant to consumers' load reductionrelative to a demand response program;

FIG. 5 is a diagram of plots of spot market price versus power and forsupply and load;

FIG. 6 is a diagram of a plot of ancillary service penalty versus power;

FIG. 7 is a diagram of a set of equations concerning elimination of adifference in power balance equation for a load greater than supply;

FIG. 8 is a diagram of a set of equations concerning elimination of adifference in power balance equation for a load less than supply;

FIG. 9 is a diagram of balance and profit equations for a load less thansupply;

FIG. 10 is a diagram of balance and profit equations for a load greaterthan supply;

In FIG. 11, is a diagram of symbols representing optimization of a powerdifferential and profit;

FIG. 12 is a diagram of a graph involving an aggregation of costfunction values in selected scenarios with fixed parameters;

FIG. 13 is a diagram of a graph showing considered bids for variousvalues of a demand response power parameter;

FIG. 14 is a diagram of a deployment scheme of the present systemrelative to a virtual energy market;

FIG. 15 is a diagram of an example infrastructure portion of demandresponse layout;

FIG. 16 is a diagram of an illustrative example of various power loadsand their relationships;

FIG. 17 is a diagram of an example optimization procedure; and

FIG. 18 is a diagram about evaluation of acceptance using variousscenarios.

DESCRIPTION

A utility company may be responsible for stabilization of the power gridand for this purpose can use several stabilization mechanisms. Theutility company or companies may have made an effort to reduce usage ofthe ancillary services because of their high prices. A demand response(DR) program may be another option to ensure a stability of the grid byinfluencing the demand. With an application of the program, the utilitycompany may change customers' loads if a change is beneficial. Utilitycompanies may offer various demand response programs to their customersand each customer can participate in a DR program in its own way. DRprograms may be divided into programs with discrete decisions andreal-time pricing.

However, DR programs may have considerable drawbacks for bothsides—consumers and utility companies. First, the utility company mayface a rather difficult decision. In a case of programs with discretedecisions, a DR adjustment is not necessarily smooth and may represent acomplex combinatory issue. In case of real-time pricing, it may bedifficult to determine an appropriate price as well as the reactions ofthe consumers that are of a stochastic nature. “Stochastic” may be of orpertain to a process involving a randomly determined sequence ofobservations each of which is considered as a sample of one element froma probability distribution.

On the other hand, the consumers may have to consider their reactions toa DR event with respect to changing prices (in the case of real-timepricing). Alternatively, the customers may face more or less discretedecisions.

Demand bidding programs may just exploit fixed incentives (e.g., 0.50cents/kW in day-ahead mode and 0.60 cents/kW in day-of mode). Theparticipants may then just decide whether they should submit their bidsand determine what amount of power they are willing to curtail. Bids maybe gathered by a utility or at a demand response automation server(DRAS) and evaluated when the time for bid-sending is over. Such anapproach may have some disadvantages. First, the fixed discount rate maynot necessarily be always beneficial because of its inherent inabilityto react on current conditions (e.g., real time price, actual demand,and so on). It is simply not necessarily a result of continuous tradingbut may be rather of an apparent long-term over-designed estimate.Second, the programs may count just with the demand reduction on theparticipants' side. However, when a utility is facing a power surplus,it may be beneficial for the utility to provide an incentive payment toa customer who commits to move some power required operation (i.e., are-schedulable load) to a time interval with a surplus.

The present approach may provide a business model for utilities andtheir consumers that copes with above-mentioned issues, and also be arelated decision support tool for utilities for bringing in significantsavings.

One goal may be to create a virtual submarket between a utility company(retailer) and its customer. A customer may actively participate in a DRprogram and supply bids for a load increase or reduction to the virtualsubmarket (located on utility side).

Customers may evaluate and submit bids that consist of an energy amountand a corresponding price. A price may depend on the particular case andcan be categorized as revenue in the case of load reduction, or as adiscount price for an additional load in the case of a load increase.

A utility company may need to eliminate differences between generated(purchased) and demanded power. Three kinds of mechanisms may beutilized for elimination of a power difference. The mechanisms may 1)use ancillary services, 2) purchase or sell power at the spot market, or3) influence the demand via DR program events, respectively. Eachmechanism may have its advantages and disadvantages.

1) Ancillary services may represent an ample power source withdeterministic prices, but these prices can be high. 2) On the spotmarket, the power may be sold or bought under market prices which are ofa stochastic nature and unknown until trading time. 3) In the present DRmechanism, prices for DR may be given by customers and the prices may benondeterministic, but known. The utility may have full control ofacceptance of the customer's bids (DR power). The first two mechanismsmay affect the supply side and the last mechanism (DR) may affect thedemand side. The utility may make a decision about an optimal structureof a power stack used for elimination of a power difference. The powermay be considered as a mix of DR power, power bought on spot market, andancillary services power.

A present decision support system may be provided in a form of, e.g., aweb service residing on a cloud, on an automated demand response serverand help to find an optimal ratio of power mixing. The system may use ascenario approach for overcoming the uncertainty that is included incustomer's loads and in final spot market prices. Advanced optimizationalgorithms (i.e., mixed integer stochastic optimization) may be employedfor optimal power mixing and optimal customer bids selection.Probabilistic measures may be exploited for an evaluation of risk. Alevel of risk may be specified by the utility (e.g., conservativebehavior versus aggressive behavior).

There may be basically two major features of the present approach. 1)The customers may have the opportunity to influence the final incentives(which are fixed in a current demand bidding program (DBP)) as they areallowed to send the bids that consist not only of a powerreduction/increase amount but also an expected price for each particularamount. Furthermore, not only may load reduction bids be requested butalso bids may be made for load increases. The utility may then decidewhether it is economically beneficial to exploit these bids or, e.g.,sell the power surplus back to the market. 2) A present decision supporttool may help the utility to make the most beneficial decisions in everystep of an operation. For example, the tool may suggest an optimumamount of power to be taken from accepted bids (besides the decisionabout which bids should be accepted), an optimum amount of power thatshould be traded at the market, and so forth (e.g., from ancillaryservices). The decisions may be generated by the optimization tool thatconsiders the stochastic nature of involved variables by using aso-called scenario approach (i.e., a significant principle fromstochastic optimization).

There may be devices placed on the customer site that can communicatewith a DR server. Each customer may be allowed to submit bids thatconsist of a provided amount of demand reduction/increase, time intervaland price offer. The bid may also have a form of a function(price=function(power increase or reduction)). Bids may be generatedeither manually or automatically whenever they are requested by the DRAS(demand response automation server) hosting the virtual sub-marketapplication. Similarly with respect to demand bidding programs, whichmay already be run by most of the utilities supporting a demandresponse, the bids may be requested the day before a particular event(i.e., day-ahead mode) or directly during the event day (i.e., day-ofmode, near future or real time DR).

When an electricity demand forecaster, running at the DRAS, indicatesthat, on the next day (a day-ahead mode), there may be a highprobability of a mismatch between purchased/generated power and aforecasted demand, the request for bids may be sent to virtually all DRparticipants. The participants may be requested to send their bids up tosome fixed deadline on the day before event. The participants of theparticular DR program may then submit their bids. The utility mayevaluate the most profitable composition of a power stack needed forovercoming the purchased/generated power versus demand discrepancy.Nearly, the same mechanism may be utilized for the day-of events. Theevents may be generated when more accurate (forecast horizon in order ofhours) predictions are available. The participants may then have, ofcourse, less time to submit their bids; however, they can expect higherpayments as the final price should be more influenced by the spot marketand the ancillary services price. In both modes (the day-ahead andday-of), the virtual sub-market application running at DRAS may beresponsible for generating recommendations for a utility in how tocompound the power from different sources (e.g., the market, ancillaryservices, DR bids, and so on) in the final corrective action thatmatches the demand and supply with each other.

A decision support system may be based on a virtual energy market (VEM).Accomplishments may incorporate establishing a new mechanism for demandresponses, creating a virtual submarket between a retailer (utility) andits customers, and bringing benefits to the retailer (i.e., higherprofit) and to consumers (i.e., more savings).

FIG. 1 may be a basic diagram illustrative of the components anddynamics between an energy market 11, a retailer (e.g., utility), andconsumption 13 (e.g., customers). A two-way relationship may existbetween market 11 and retailer 12. A two-way relationship may also existbetween consumption 13 and retailer 12. For instance, bids ofconsumption may be either accepted or denied.

FIG. 2 is a diagram of a graph of power versus time. In an example,curve 14 may represent generated power and curve 15 may represent aload. Load may be understood as power utilized by a consumer (e.g.,customer). FIG. 3 is a diagram of a graph of power difference and time.Curve 16 may represent a power difference between thegenerated/purchased power and the load. Customers may participateactively in a DR program, supply bids for load increases or reductions,and send these bids to the retailer (utility, ADR Server). These bidsmay be used to reduce the power difference.

FIG. 4 is a diagram of graphs relevant to customers' overall loadreduction (DR). Graph 21 for a customer #1 may be R_(DR) (revenue—demandresponse) versus P_(DR) (power—demand response) where there is a bar forR_(DR) at each P_(DR) increment. An R_(Spot) (revenue—spot market) isshown in graph 21. Graph 22 for customer #2 may be R_(DR) versus P_(DR)where there is a bar for R_(DR) at each P_(DR) increment. An R_(Spot) isshown in graph 22. Graph 23 may be R_(DR) versus P_(DR) where theinformation of customers #1 and #2 are combined to reveal an aggregatedload for DR. There is a bar of customer #1 or #2 for R_(DR) at eachP_(DR) increment, as indicated by a shading of the bar. A ΔP (e.g., adifference between generated power and demand power) is indicated ingraph 23. An R_(Spot) level is also shown in graph 23.

FIG. 5 is a diagram of a graph of the spot market. The graph may beplots of R_(Spot) (price for power unit on the spot market) versusP_(Spot) (power—spot market) for supply as shown by plot 25 and for loadas shown by plot 26.

FIG. 6 is a diagram of a graph of ancillary services.

The graph may be plot R_(Penalty) (revenue—penalty) versus P_(AS)(power—ancillary services) as indicated by lines 27.

Particular bids may consist of an amount of energy, duration time andincentives. The incentives may depend of the particular case which mayprovide revenue in the event of load reduction and a discount of pricefor additional loads in the event of a load increase.

A retailer (utility) may eliminate differences between purchased andload power or energy. The difference may be eliminated via DR, spotmarket or ancillary power. The retailer may make a decision aboutaccepting bids from customers.

A retailer may purchase an energy or power profile for the next day inthe day-a-head market. The purchase may depend on a load forecast forthe next day. Generally, power differences may occur because of loaduncertainties. A retailer may want to eliminate the differences in aneconomically optimal way.

Difference elimination possibilities may incorporate: 1) Letting asystem operator making use of ancillary services to eliminate thedifference (i.e., an expensive way); 2) Selling or purchasing, forinstance, electricity on the market (i.e., price is given bymarket—stochastic approach); and 3) Making a demand response action(i.e., price is given by relationship of a trader-consumer—deterministicapproach).

One may note an optimization at a one time instance of a ΔP eliminationwith a set 31 of equations indicated in FIG. 7 for a load greater thansupply. A balance equation may be indicating ΔP=P_(load)−P_(Purchased).“−P_(DR)−P_(Spot)−P_(AS)” may indicate specifics of a ΔP correction, as“ΔP−P_(DR)−P_(Spot)−P_(AS)=0”. A profit equation may beR=R_(Load)−R_(DR)−R_(Spot)−R_(AS)−R_(Purchased). R_(Load) may indicatethat paid by customers, a deterministic variable (given by contracts)and reflect an actual load. R_(DR) may indicate a price given by a DRmechanism, a stochastic variable and a decision about a price made onthe side of a retailer. R_(SPOT) may indicate unit costs given by a spotmarket, a stochastic variable and involve a risk of increased costs.R_(AS) may indicate a price given by a central authority, adeterministic variable and having a risk of a possible penalty.R_(Purchased) may indicate costs for power already bought.

One may note an optimization of a ΔP elimination with a set 32 ofequations indicated in FIG. 8 for a load less than supply. A balanceequation may be indicated by ΔP=P_(load)−P_(Purchased).“+P_(DR)+P_(Spot)+P_(AS)” may indicate specifically of a ΔP correction,as “ΔP+P_(DR)+P_(Spot)+P_(AS)=0”. A profit equation may beR=R_(Load)−R_(DR)+R_(Spot)−R_(AS)−R_(Purchased). R_(Load) may indicatethat paid by customers, a deterministic variable (given by contracts)and reflect an actual load. R_(DR) may indicate a price given by a DRmechanism, a stochastic variable and a decision about a price made onthe side of a retailer. R_(SPOT) may indicate a price given by a spotmarket, a stochastic variable and involve a chance of a lower price orbids that could not be accepted. R_(AS) may indicate a price given by acentral authority, a deterministic variable and having a risk of apossible penalty. R_(Purchased) may indicate costs for power alreadybought.

FIGS. 9 and 10 reveal balance and cost equations. For load less thansupply in FIG. 9, a set 33 of equations, as noted herein, mayincorporate a balance equation of ΔP=P_(load)−P_(Purchased), whereΔP+P_(DR)+P_(Spot)+P_(AS)=0. “+P_(DR)+P_(Spot)+P_(AS)” may indicatespecifics of a ΔP correction. Also in set 33 may be a profit equation of

R(ΔP)=R _(Load)(P)−R _(DR)(α·ΔP)−R _(Spot)(β·ΔP)−R _(AS)(χ·ΔP)−R_(Purchased).

R_(Load)(P) may indicate a deterministic price (known) and loadreflection. R_(DR)(α·ΔP) may indicate a stochastic price (known) andlimited power. R_(Spot)(β·ΔP) may indicate a stochastic price (unknown)and partially limited power. R_(AS)(χ·ΔP) may indicate a deterministicprice (penalty) and “unlimited” power. R_(Purchased) may indicatepurchased power and is not necessarily important for optimization.

For a load greater than supply, a set 34 of equations, as shown in FIG.10, may incorporate a balance equation of ΔP=P_(load)−P_(Purchased),where ΔP=P_(DR)+P_(Spot)+P_(AS)=0 “+P_(DR)+P_(Spot)+P_(AS)” may indicatespecifics of a ΔP correction. Also in set 34, may be a profit equationof

R(ΔP)=R _(Load)(P)−R _(DR)(α·ΔP)+R _(Spot)(β·ΔP)−R _(AS)(χ·ΔP)−R_(Purchased).

R_(Load)(P) may indicate a deterministic price (known) and loadreflection. R_(DR)(α·ΔP) may indicate a stochastic price (known) andlimited power. R_(Spot)(β·ΔP) may indicate a stochastic price (unknown)and partially limited power. R_(AS)(χ·ΔP) may indicate a deterministicprice (penalty) and “unlimited” power. R_(Purchased) may indicatepurchased power and is not necessarily important for optimization.

In FIG. 11, symbols 35 representing optimization may incorporate

$\max\limits_{\alpha,\beta,{\chi \in {\langle{0;1}\rangle}}}{R\left( {P,{\Delta \; P}} \right)}$

where α+β+χ=1. A scenario approach may be used to overcome anuncertainty. Solving the optimization task may be done with a presentlyselected approach. Probabilistic measures may lead to a determination ofrisk.

An optimization sequence may incorporate: 1) Reading historical datafrom a database; 2) Constructing one or more load forecasting models; 3)Retrieving external information about prices and weather trends; 4)Retrieving bids from consumers; 5) Using the models, generatingscenarios and considered parameter combinations (α, β, χ) (e.g., 0.6,0.3, 0.1); 6) For each parameter combination (α, β, χ), a) evaluating acost function for particular settings (α, β, χ) over virtually allscenarios, and b) using probabilistic measures, e.g., a combination thebrings a highest revenue at a given risk level (such as revenue achievedwith 95 percent probability), as an aggregation function for virtuallyall scenarios in determination of a final value of the cost function forthe combination (α, β, χ); 7) Finding optimal values of parameters α*,β*, χ* from aggregated values; 8) Informing consumers about acceptance;and 9) Measuring a real operation and saving the operation to adatabase.

As to step 2, concerning model construction, models may be needed for:a) Distributions P(Weather), P(Prices), P(Behavior|Weather) and/orP(Behavior); b) Mapping Consumption(Weather, Behavior, Acceptance); andc) Mapping Profit(Consumption, Acceptance, Prices). One may note profitas revenue and cost but as also involving accepted and fulfilledincentives.

The models may be obtained or construed from historical data (i.e., ablack box), possibly with use of: a) Some apparent relationships such assumming up the total consumption of particular consumers; b) Externalinformation such as weather forecasts, public holidays, and so forth;and c) Behavior to be modeled as a function of time explaining modelingresiduals of black box models of the consumption conditioned by weatherand acceptance.

As to step 5, concerning application of a scenario approach, a scenariomay represent uncertain information in the system. Knowing the scenarioand making a decision, a next evolution of the system may be determined.In a case of DR programs, scenarios may involve: a) Weather(temperature, humidity, solar radiation) which may not necessarilydepend on decisions; b) Consumer behavior patterns (daily, weekly,yearly trends) which may be affected by acceptance of demand responsebids; c) Spot market (prices); and d) Impact of DR (e.g., in the hopethat the consumer is able to fulfill the bid).

As to step 5, concerning generating scenarios, items to be noted mayincorporate: 1) Sampling a trajectory of weather, prices; 2) Conditionedin this trajectory, sampling a trajectory of behavior; and 3)Determining consumption as a function of acceptance. The steps may berepeated in that many scenarios are generated. Thus, each scenario “s”may produce mapping—Consumption_(s)(Acceptance). Consumption and pricesmay directly determine utility profit—Profit_(s)(Acceptance).

As to step 6, an aim of optimization may be to maximize profit withensuring an elimination of a power difference—ΔP+ΔP_(CORR)=0 andΔP_(CORR)=(a·ΔP)+(β·ΔP)+(χ·ΔP), where (α·ΔP) pertains to R_(DR), (β·ΔP)pertains to R_(SPOT), and (χ·ΔP) pertains to R_(AS). An optimizationalgorithm may find an optimal combination of a spot market power 13 andan ancillary services power χ. A demand response power a may be adiscrete variable determined by acceptance. An impact of individualconsumers may be assumed to be reasonably independent. With respect to asearch algorithm, genetic algorithms may be proposed because of adiscontinuous objective function. Other heuristics may be applicable ifa set of accepted bids does not depend on a simple sort.

FIGS. 12 and 13 reveal an optimization example, relative to step 6. FIG.12 is a diagram of a graph involving an aggregation of cost functionvalues in two selected scenarios with parameters β, χ. The graph shows aprofit function with R versus an optimized parameter α. 1_(o) representsscenario 1. 2_(o) represents scenario 2. Line 37 indicates a mean valueand line 38 indicates a minimum value. It may be noted that α+β+χ=1,α={0.1, 0.25, 0.4, 0.65, 0.82, 0.97}, and β,χε<0;1>.

FIG. 13 is a diagram of a graph 39 showing received unit price bids withan amount versus a for considered bids. Unconsidered bids are alsonoted. The light and dark bars may represent customers #1 and #2,respectively.

As to step 6, concerning risk measures, the following factors may beconsidered. Using a selected measure may determine an aggregationfunction. Parameter a may represent an optimal combination of suppliedbids (discretized value). A selected combination may optimize anobjective function (e.g., profit) over virtually all scenarios with aconsideration of risk. Possible aggregation approaches mayincorporate: 1) Mean—a combination may maximize expected profit overvirtually all scenarios; 2) Worst case—a combination may maximize aminimal profit over virtually all scenarios; and 3) Percentile—acombination may maximize a profit that is given by N-th percentile ofthe objective functions for virtually all scenarios.

FIG. 14 is a diagram of a deployment scheme of the present systemrelative to a virtual energy market (VEM). A VEM 41 incorporating aprobability distribution generator/estimator 42, a forecaster module 43,a scenario generation module 44 and a decision (optimization) engine 45.The probability distribution generator/estimator 42, forecaster module43, scenario generation module 44 and decision (optimization) engine 45may be interconnected to one another. A utility/system operator (SO) 46may provide information such as renewable generation and grid status toengine 45. Customers involved in auto-DR may incorporate one or moreresidential customers 47, commercial customers 48 and industrialcustomers 49. Customers 47, 48 and 49 may provide electricityconsumption data to a database such as a meter data management (MDM)system database 51. Database 51 may provide selected relevant data toVEM 41. A weather forecast database 52 may provide temperature,humidity, solar radiation and related information to VEM 41. An energymarket database 53 may provide market prices and related information toVEM 41. There may also be ancillary services and related informationavailable for VEM 41. Other databases may provide pertinent informationto VEM 41. Decision engine 45 may take information from, for instance,scenario generator module 44, forecaster module 43, generator/estimator42, utility/ISO 46, and databases 51-53, to provide an output such asoptimal timing and selection of DR resources. The output from engine 45may go to DRAS 54 for processing. DRAS 54 may provide DR signals andbusiness information to customers 47-49. Customers 47-49 may providebusiness information (e.g., bids) to DRAS 54.

FIG. 15 is a diagram of an example infrastructure portion, e.g., demandresponse, of the present system. A DRAS server 61 at a utility may beconnected to a customer bids manager 62 via a connection 63 such as, forexample, an internet. Connection 63 may be one or more of various wireand wireless connections. Load information such as that of curtailableloads 64 and reschedulable loads 65 may be provided to customer bidsmanager 62. Curtailable loads 64 may incorporate, for example, actualloads such as 5 kW and 10 kW. The loads may be of various amounts,number and type. For each such load may be a schedule or graph 66showing DR dollars ($_(DR)) versus load reduction in terms of percentsuch as, for illustration, instances of 5, 7, 10, 20, 25, 40, 50, 60, 75and 100 percent, relative to an actual load of 5 or 10 kW. The instancesmay be any other percentages.

Reschedulable loads 65 may incorporate, for example, loads such as 1 kWfor 2 hours and 20 kW for one hour. The loads may be of any otheramounts and durations. For each of such loads may be a schedule or graph67 showing DR dollars versus time with increments of price along thetime line. There may be a time deadline where the price ($_(DR)) isstopped at a fixed level. The price at the fixed level may be, forinstance, a normal price.

FIG. 16 is a diagram of a graph showing load (e.g., kW) versus time. Thegraph is an illustrative example various loads and their relationships.The graph may show load curves for critical loads 71, curtailable loads72 and reschedulable loads 73. A maximal load line 74 indicates a levelthat no load should exceed. Other graphs of various loads and theirrelationships may be had.

Before the each optimization procedure run, the algorithm should havethe following items at its disposal. It may be noted that the solutiondescribed herein may just deal with static optimization, i.e., theoptimization task is solved separately for each time slot (e.g., onehour) or a several time slots in row but with the no correlation betweenthe slots being assumed. The present approach may be easily extended tosolve a dynamic optimization problem (allowing inter-slot dependencies).

The items may incorporate the following. 1) A weather forecast for eachDR participant (sharing weather resources may be exploited in advance).The probability distribution function, e.g., for OAT, may be estimatedfor a given time-slot. 2) Spot market price prediction for given timeslot in a form of probability distribution function. It may be estimatedbased on the historical data. 3) Individual electrical energy demandmodels for each DR participating load. An example of global multivariateregression model (ToD=Time-of-Day could simulate the occupancy levelwhich is not usually available) may be:

L=a ₀ +a ₁·OAT+a ₂·ToD+a ₃·ToD²+Accp·DR

, where Accep is a bid acceptance status (binary) and DR is a generalterm representing the influence of demand response action. 4) Bids(nominations) from all potential DR participants, where each bid (load[kW] reduction/increase) may be a function of time slot and incentiveexpected. It may mean that multiple bids for the same time slot areallowed and participants are allowed to offer their own price incontrast to current incentive politics produced exclusively byutilities.

FIG. 17 is a flow chart of an example optimization procedure. Theoptimization may be solved as a one time-slot (one step) or severaltime-slots ahead (multi-step). Symbol 81 indicates creating testingacceptance vectors. A set of eligible acceptance vectors/matrices may becreated which is a subset of all possible combinations (2N for N DRparticipants). This process may select just vectors that are worthy totest, i.e., there is a high probability that would maximize the profit.A number of selection criteria may be generated, e.g., one may sort bidsaccording to the price or participant reliability.

Symbol 82 indicates generating a sufficient number of scenarios. Createset of test scenarios (say 1000). Every scenario can be described by avector (or matrix for multi-step) of values generated based on estimated(historical data based) probability distribution functions. Followingthe example load model, the random variables of the 3-participantsscenario vector are generated based on distributions

[P(price,P(OAT₁),P(OAT₂),P(OAT₃),P(DR₁|OAT₁),P(DR₂|OAT₂),P(DR₃|OAT₃)]

where first term is the spot market price distribution, next three termsare distributions of outdoor air temperatures for given time-slot andlast three terms are conditional distributions of loadreduction/increase capabilities for given outdoor air temperatures.

Symbol 83 indicates evaluating expected demands. For every acceptancevector (selected in the first step) the expected total demand (sum ofindividual participants' demands) now may be evaluated against virtuallyall (e.g., 1000) scenarios (scenario=vector of realizations of randomvariables).

Symbol 84 indicates evaluating an expected profit distribution. Havingthe spot market price for each scenario and known penalty politics forexploiting the ancillary services (i.e., excessive power consumption),the expected profit may be evaluated for each scenario given theacceptance vector. It may be seen as a profit distribution over alltesting scenarios for given acceptance vector.

Symbol 85 indicates finding an optimum acceptance vector. Profitdistributions may then be evaluated for all testing acceptance vectors.The optimization may search for such an acceptance vector that maximizesthe profit with the given required level of confidence (i.e., risklevel). Note the set of testing acceptance vectors was found by thesearch procedure based on the bid ordering or on some other searchapproach (genetic algorithm) in the first step.

${Acc}^{*} = {\underset{{accep},{vectors}}{argmax}\left( {{Profit}\left( {{{Demand}({Acc})},{{Spot}\mspace{14mu} {Market}\mspace{14mu} {Price}},{Penalty}} \right)} \right)}$

Symbol 86 indicates exploiting the acceptance vector. The optimumacceptance vector may then support the decisions about whom to acceptthe DR bid and when.

FIG. 18 is a diagram 94 about evaluation of acceptance using variousscenarios. A utility company 90 may receive bids relative to a load 1 incolumn 91, load 2 in column 92 and load 3 in column 93. Acceptances 1, 2and 3 may be provided by utility company 90 for loads 1, 2 and 3,respectively, in columns 91, 92 and 93, respectively. For eachacceptance and scenario, the loads and profit may be knowndeterministically. Deterministic mappings 99 may consist of:Load=Load(Weather, Occupancy, Acceptance) and Profit=Profit(Profit(Load,Price, Acceptance). There may be a histogram of profit for eachacceptance.

Each column may have graphs 95 and 96 of P(Weather) versus Weather andof P(Occupancy) versus Occupancy, respectively. The energy market may berepresented with a graph 97 of P(Price) versus Price.

A table 98 may show data for a number of scenarios for three situationswith indications of Toa1, Toa2, Toa3, Occ1, Occ2 and Occ3. Price may beindicated for each scenario. In this example, weather may be determinedby outside temperature Toa. If occupancy is not available, then it maybe replaced by a time-of-day variable that is able to capture theoccupancy profile sufficiently.

To recap, a system for optimizing a balance of power, may incorporate afirst mechanism that decides about purchasing power from ancillaryservices, a second mechanism that purchases or sells power at a spotmarket, a third mechanism that purchases or sells power according to ademand response program, and a processor having a connection to thefirst, second and third mechanisms. The processor may process areduction of a difference between purchased power of a supplier anddemanded power of a consumer, by determining an amount of power boughtand/or sold with one or more of the first, second and third mechanisms.

The difference between purchased power and demanded power may beminimized by forming an optimal power stack. The power stack mayincorporate a mix having power via the demand response program, power atthe spot market, and/or power from ancillary services. The processor maydetermine the mix of the power stack to minimize the difference betweenpurchased power and demanded power.

The system may further incorporate an optimization sequence. Theoptimization sequence may incorporate maximizing profit and/orminimizing the difference between the purchased power and the demandedpower.

Some terms may incorporate P_(Load) as demanded power, P_(Purchased) aspurchased power, and ΔP as the difference between P_(Load) andP_(Purchased). Also, there may P_(DR)=αΔP, P_(Spot)βΔP, and P_(AS)=χΔPΔP_(Correction) may incorporate P_(DR), P_(Spot) and P_(AS).ΔP+ΔP_(Correction)=0 and α+β+χ≈1 may be applicable.

α could be a discrete variable representing a magnitude of acceptance ofthe consumer in the demand response program. A power difference may beΔP=P_(Load)−P_(Purchased). For a load greater than supply,ΔP−P_(DR)−P_(Spot)−P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)+R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased).Also, −P_(DR)−P_(Spot)−P_(AS)=ΔP_(Correction), R(ΔP) may be profit,R_(Load)(P) may be a price of the load, and R_(DR)(αΔP) may be a priceof power determined between the utility and the consumer in a demandresponse relationship. Also, R_(Spot)(βΔP) may be a price of power on anopen market, and R_(AS)(χΔP) may be a price of power from a systemoperator providing ancillary services at a set price. One may haveα+β+χ≈1, and

$\max\limits_{\alpha,\beta,{\chi \in {\langle{0;1}\rangle}}}{R\left( {P,{\Delta \; P}} \right)}$

for optimization.

A power difference may be ΔP=P_(Load)−P_(Purchased). For a load lessthan supply, there may be ΔP+P_(DR)+P_(Spot)+P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)−R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased).There may be P_(DR)+P_(Spot)+P_(AS)=ΔP_(Correction). R(ΔP) may beprofit, and R_(Load)(P) may be a price of the load. R_(DR)(αΔP) may be aprice of power determined between the utility and the consumer in ademand response relationship. R_(Spot)(βΔP) may be a price of power onan open market, and R_(AS)(χΔP) may be a price of power from a systemoperator providing ancillary services at a set price. One may haveα+β+χ≈1, and

$\max\limits_{\alpha,\beta,{\chi \in {\langle{0;1}\rangle}}}{R\left( {P,{\Delta \; P}} \right)}$

for optimization.

A system for managing energy, may incorporate a server, a virtual energymarketing (VEM) module connected to the server, a utility energy sourceconnected to the VEM module, a meter data management (MDM) databaseconnected to the VEM module, an energy consumer connected to the serverand the MDM database, and an energy market source connected to the VEMmodule.

The VEM module may incorporate a decision engine connected to theutility energy source and the server, a scenario generator connected tothe decision engine, a forecaster mechanism connected to the scenariogenerator and the MDM database, and a probability distribution generatorconnected to the forecaster, the energy market database and the weatherforecast database. The system for managing energy may furtherincorporate a weather forecast database connected to the probabilitydistribution generator.

The utility may provide information about power unbalance between loadedpower and purchased power and/or grid status to the decision engine.Demand response signals and business information may be exchangedbetween the consumer and the server. The decision engine may provideoptimal timing and selection of demand response resources to the server.The consumer may provide energy consumption data to the MDM database.The forecaster may receive selected relevant data from the MDM database.The energy market source may provide a market price to the probabilitydistribution generator.

The system may further incorporate a weather forecast database connectedto the probability distribution generator. The weather forecast databasemay provide weather parameters to the probability distributiongenerator. The server may be a demand response automation server.

An approach for coordinating power transactions, may incorporate findingout an amount of purchased power of a utility, finding out an amount ofdemanded power by a consumer, minimizing a power difference between anamount of purchased power of the utility and an amount of demanded powerby the consumer, minimizing the power difference that depends on, atleast in part, purchasing power from a system operator providingancillary services at a set price, selling or purchasing power on theopen market at market price, and/or selling or purchasing power at aprice determined between the utility and the consumer in a demandresponse relationship.

The power difference may be between an amount of purchased power of theutility and an amount of demanded power by the consumer, with optimizinga combination of P_(Spot), P_(AS) and P_(DR) Goals of optimizing thecombination may incorporate maximizing profit to the utility andminimizing the power difference.

αΔP, βΔP and χΔP may represent portions of the respective power thatconstitute the power difference between the amount of purchased power ofthe utility and the amount of demanded power by the consumer. Parametersα, β and χ may be determined to minimize the power difference, whereα+β+χ≈1.

In the approach, the power difference may be ΔP=P_(Load)−P_(Purchased).For a load greater than supply, ΔP=P_(DR)⊕P_(Spot)−P_(AS)=0 andR(ΔP)βR_(Load)(P)−R_(DR)(αΔP)+R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased).There may be −P_(DR)−P_(Spot)−P_(AS)=ΔP_(Correction). R(ΔP) may beprofit, and R_(Load)(P) may be a price of the load. R_(DR)(αΔP) may be aprice of power determined between the utility and the consumer in ademand response relationship. R_(Spot)(βΔP) may be a price of power onan open market. R_(AS)(χΔP) may be a price of power from a distributioncompany providing ancillary services at a set price, and α+β+χ≈1.

The power difference may be ΔP=P_(Load)−P_(Purchased). For a load lessthan supply, ΔP+P_(DR)+P_(Spot)+P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)−R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased).There may be P_(DR)+P_(Spot)+P_(AS)=ΔP_(Correction). R(ΔP) may beprofit. R_(Load)(P) may be a price of the load. R_(DR)(αΔP) may be aprice of power determined between the utility and the consumer in ademand response relationship. R_(Spot)(βΔP) may be a price of power onan open market. R_(AS)(χΔP) may be a price of power from a distributioncompany providing ancillary services at a set price, and α+β+χ≈1.

In the present specification, some of the matter may be of ahypothetical or prophetic nature although stated in another manner ortense.

Although the present system and/or approach has been described withrespect to at least one illustrative example, many variations andmodifications will become apparent to those skilled in the art uponreading the specification. It is therefore the intention that theappended claims be interpreted as broadly as possible in view of therelated art to include all such variations and modifications.

What is claimed is:
 1. A system for optimizing a balance of power,comprising: a first mechanism that decides about purchasing power fromancillary services; a second mechanism that purchases or sells power ata spot market; a third mechanism that purchases or sells power accordingto a demand response program; and a processor having a connection to thefirst, second and third mechanisms; and wherein the processor processesa reduction of a difference between purchased power of a supplier anddemanded power of a consumer, by determining an amount of power boughtand/or sold with one or more of the first, second and third mechanisms.2. The system of claim 1, wherein the difference between purchased powerand demanded power is minimized by forming an optimal power stack. 3.The system of claim 2, wherein the power stack comprises a mix havingpower via the demand response program, power at the spot market, and/orpower from ancillary services.
 4. The system of claim 3, wherein theprocessor determines the mix of the power stack to minimize thedifference between purchased power and demanded power.
 5. The system ofclaim 1, further comprising: an optimization sequence; and wherein theoptimization sequence comprises maximizing profit and/or minimizing thedifference between the purchased power and the demanded power.
 6. Thesystem of claim 1, wherein: P_(Load) is demanded power; P_(Purchased) ispurchased power; and ΔP is the difference between P_(Load) andP_(Purchased).
 7. The system of claim 6, wherein: P_(DR)=αΔP;P_(Spot)βΔP; P_(AS)=χΔP; ΔP_(Correction) comprises P_(DR), P_(Spot) andP_(AS); ΔP+ΔP_(Correction)=0; and α+β+χ≈1.
 8. The system of claim 6,wherein a could be a discrete variable representing a magnitude ofacceptance of the consumer in the demand response program.
 9. The systemof claim 6, wherein: a power difference is ΔP=P_(Load)−P_(Purchased);for a load greater than supply, ΔP=P_(DR)−P_(Spot)−P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)+R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased);−P_(DR)−P_(Spot)−P_(AS)=ΔP_(Correction); R(ΔP) is profit; R_(Load)(P) isa price of the load; R_(DR)(αΔP) is a price of power determined betweenthe utility and the consumer in a demand response relationship;R_(Spot)(βΔP) is a price of power on an open market; R_(AS)(χΔP) is aprice of power from a system operator providing ancillary services at aset price; α+β+χ≈1; and$\max\limits_{\alpha,\beta,{\chi \in {\langle{0;1}\rangle}}}{R\left( {P,{\Delta \; P}} \right)}$for optimization.
 10. The system of claim 6, wherein: a power differenceis ΔP=P_(Load)−P_(Purchased); for a load greater than supply,ΔP=P_(DR)+P_(Spot)+P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)−R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased);−P_(DR)+P_(Spot)+P_(AS)=ΔP_(Correction); R(ΔP) is profit; R_(Load)(P) isa price of the load; R_(DR)(αΔP) is a price of power determined betweenthe utility and the consumer in a demand response relationship;R_(Spot)(βΔP) is a price of power on an open market; R_(AS)(χΔP) is aprice of power from a system operator providing ancillary services at aset price; α+β+χ≈1; and$\max\limits_{\alpha,\beta,{\chi \in {\langle{0;1}\rangle}}}{R\left( {P,{\Delta \; P}} \right)}$for optimization.
 11. A system for managing energy, comprising: aserver; a virtual energy marketing (VEM) module connected to the server;a utility energy source connected to the VEM module; a meter datamanagement (MDM) database connected to the VEM module; an energyconsumer connected to the server and the MDM database; and an energymarket source connected to the VEM module.
 12. The system of claim 11,wherein the VEM module comprises: a decision engine connected to theutility energy source and the server; a scenario generator connected tothe decision engine; a forecaster mechanism connected to the scenariogenerator and the MDM database; and a probability distribution generatorconnected to the forecaster, the energy market database and the weatherforecast database.
 13. The system of claim 12, further comprising aweather forecast database connected to the probability distributiongenerator.
 14. The system of claim 12, wherein: the utility providesinformation about power unbalance between loaded power and purchasedpower and/or grid status to the decision engine; demand response signalsand business information are exchanged between the consumer and theserver; the decision engine provides optimal timing and selection ofdemand response resources to the server; the consumer provides energyconsumption data to the MDM database; the forecaster receives selectedrelevant data from the MDM database; and the energy market sourceprovides a market price to the probability distribution generator. 15.The system of claim 14, further comprising: a weather forecast databaseconnected to the probability distribution generator; and wherein theweather forecast database provides weather parameters to the probabilitydistribution generator.
 16. The system of claim 14, wherein the serveris a demand response automation server.
 17. A method for coordinatingpower transactions, comprising: finding out an amount of purchased powerof a utility; finding out an amount of demanded power by a consumer;minimizing a power difference between an amount of purchased power ofthe utility and an amount of demanded power by the consumer; minimizingthe power difference that depends on, at least in part, purchasing powerfrom a system operator providing ancillary services at a set price,selling or purchasing power on the open market at market price, and/orselling or purchasing power at a price determined between the utilityand the consumer in a demand response relationship.
 18. The method ofclaim 17, wherein: the power difference is between an amount ofpurchased power of the utility and an amount of demanded power by theconsumer, with optimizing a combination of P_(Spot), P_(AS) and P_(DR);and goals of optimizing the combination comprise maximizing profit tothe utility and minimizing the power difference.
 19. The method of claim18, wherein: αΔP, βΔP and χΔP represent portions of the respective powerthat constitute the power difference between the amount of purchasedpower of the utility and the amount of demanded power by the consumer;parameters α, β and χ are determined to minimize the power difference;and α+β+χ≈1.
 20. The method of claim 17, wherein: a power difference isΔP=P_(Load)−P_(Purchased); for a load greater than supply,ΔP=P_(DR)−P_(Spot)−P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)+R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased);−P_(DR)−P_(Spot)−P_(AS)=ΔP_(Correction); R(ΔP) is profit; R_(Load)(P) isa price of the load; R_(DR)(αΔP) is a price of power determined betweenthe utility and the consumer in a demand response relationship;R_(Spot)(βΔP) is a price of power on an open market; R_(AS)(χΔP) is aprice of power from a distribution company providing ancillary servicesat a set price; and α+β+χ≈1.
 21. The method of claim 17, wherein: apower difference is ΔP=P_(Load)−P_(Purchased); for a load greater thansupply, ΔP=P_(DR)+P_(Spot)+P_(AS)=0 andR(ΔP)=R_(Load)(P)−R_(DR)(αΔP)−R_(Spot)(βΔP)−R_(AS)(χΔP)−R_(Purchased);−P_(DR)+P_(Spot)+P_(AS)=ΔP_(Correction); R(ΔP) is profit; R_(Load)(R) isa price of the load; R_(DR)(αΔP) is a price of power determined betweenthe utility and the consumer in a demand response relationship;R_(Spot)(βΔP) is a price of power on an open market; R_(AS)(χΔP) is aprice of power from a distribution company providing ancillary servicesat a set price; and α+β+χ≈1.